[Introduced February 11, 2000; referred to the Committee
on the Judiciary; and then to the Finance.]

____________

A BILL to amend and reenact section ten, article twenty-two-a,
chapter twenty-nine of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to the
distribution of proceeds from net terminal income of racetrack
video lottery proceeds; and providing funds for health,
disability and retirement benefits for eligible active,
disabled and retired West Virginia jockeys and their
dependents.

Be it enacted by the Legislature of West Virginia:That section ten, article twenty-two-a, chapter twenty-nine of
the code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:ARTICLE 22A. RACETRACK VIDEO LOTTERY.§29-22A-10. Accounting and reporting; commission to provide
communications protocol data; distribution of net
terminal income; remittance through electronic
transfer of funds; establishment of accounts and
nonpayment penalties; commission control of
accounting for net terminal income; settlement of
accounts; manual reporting and payment may be
required; request for reports; examination of
accounts and records.(a) The commission shall provide to manufacturers, or
applicants applying for a manufacturer's permit, the protocol
documentation data necessary to enable the respective
manufacturer's video lottery terminals to communicate with the
commission's central computer for transmitting auditing program
information and for activation and disabling of video lottery
terminals.(b) The gross terminal income of a licensed racetrack shall be
remitted to the commission through the electronic transfer of
funds. Licensed racetracks shall furnish to the commission all
information and bank authorizations required to facilitate the timely transfer of moneys to the commission. Licensed racetracks
must provide the commission thirty days' advance notice of any
proposed account changes in order to assure the uninterrupted
electronic transfer of funds. From the gross terminal income
remitted by the licensee to the commission, the commission shall
deduct an amount sufficient to reimburse the commission for its
actual costs and expenses incurred in administering racetrack video
lottery at the licensed racetrack, and the resulting amount after
such deduction shall be the net terminal income. The amount
deducted for administrative costs and expenses of the commission
may not exceed four percent of gross terminal income.(c) Net terminal income shall be divided as set out in this
subsection. The licensed racetrack's share shall be in lieu of all
lottery agent commissions and is considered to cover all costs and
expenses required to be expended by the licensed racetrack in
connection with video lottery operations. The division shall be
made as follows:(1) The commission shall receive thirty percent of net
terminal income, which shall be paid into the general revenue fund
of the state to be appropriated by the Legislature;(2) FourteenThirteen and three quarters percent of net terminal income at a licensed thoroughbred racetrack shall be
deposited in the special fund established by the licensee, and used
for payment of regular purses in addition to other amounts provided
for in article twenty-three, chapter nineteen of this code, and
fourteen percent of net terminal income at all other licensed
racetracks shall be deposited in the special fund established by
the licensee, and used for payment of regular purses in addition to
other amounts provided for in article twenty-three, chapter
nineteen of this code;(3) The county where the video lottery terminals are located
shall receive two percent of the net terminal income: Provided,
That:(A) Beginning the first day of July, one thousand nine hundred
ninety-nine, and thereafter, any amount in excess of the two
percent received during fiscal year one thousand nine hundred
ninety-nine by a county in which a racetrack is located that has
participated in the West Virginia thoroughbred development fund
since on or before the first day of January, one thousand nine
hundred ninety-nine, shall be divided as follows:(i) The county shall receive fifty percent of the excess
amount; and(ii) The municipalities of the county shall receive fifty
percent of the excess amount, said fifty percent to be divided
among the municipalities on a per capita basis as determined by the
most recent decennial United States census of population; and
(B) Beginning the first day of July, one thousand nine hundred
ninety-nine, and thereafter, any amount in excess of the two
percent received during fiscal year one thousand nine hundred
ninety-nine by a county in which a racetrack other than a racetrack
described in paragraph (A) of this proviso is located and where
the racetrack has been located in a municipality within the county
since on or before the first day of January, one thousand nine
hundred ninety-nine, shall be divided, if applicable, as follows:(i) The county shall receive fifty percent of the excess
amount; and(ii) The municipality shall receive fifty percent of the
excess amount; and(C) This proviso shall not affect the amount to be received
under this subdivision by any county other than a county described
in paragraph (A) or (B) of this proviso;(4) One half of one percent of net terminal income shall be
paid for and on behalf of all employees of the licensed racing association by making a deposit into a special fund to be
established by the racing commission to be used for payment into
the pension plan for all employees of the licensed racing
association;(5) The West Virginia thoroughbred development fund created
under section thirteen-b, article twenty-three, chapter nineteen of
this code and the West Virginia greyhound breeding development fund
created under section ten, article twenty-three, chapter nineteen
of this code shall receive an equal share of a total of not less
than one and one-half percent of the net terminal income:
Provided, That for any racetrack which does not have a breeder's
program supported by the thoroughbred development fund or the
greyhound breeding development fund, the one and one-half percent
provided for in this subdivision shall be deposited in the special
fund established by the licensee and used for payment of regular
purses, in addition to other amounts provided for in subdivision
(2) of this subsection and article twenty-three, chapter nineteen
of this code;(6) The West Virginia thoroughbred breeders classic shall
receive one percent of the net terminal income which shall be used
for purses. The moneys shall be deposited in the separate account established for the classic under section thirteen, article
twenty-three, chapter nineteen of this code;(7) A licensee that operates a thoroughbred racetrack shall
receive forty-six and three quarters percent of net terminal
income, and all other licensees shall receive forty-seven percent
of net terminal income;(8) The tourism promotion fund established in section twelve,
article two, chapter five-b of this code shall receive three
percent of the net terminal income; and(9) The veterans memorial program shall receive one percent of
the net terminal income until sufficient moneys have been received
to complete the veterans memorial on the grounds of the state
capitol complex in Charleston, West Virginia. The moneys shall be
deposited in the state treasury in the division of culture and
history special fund created under section three, article one-i,
chapter twenty-nine of this code: Provided, That only after
sufficient moneys have been deposited in the fund to complete the
veterans memorial and to pay in full the annual bonded indebtedness
on the veterans memorial, not more than twenty thousand dollars of
the one percent of net terminal income provided for in this
subdivision shall be deposited into a special revenue fund in the state treasury, to be known as the "John F. 'Jack' Bennett Fund".
The moneys in this fund shall be expended by the division of
veterans affairs to provide for the placement of markers for the
graves of veterans in perpetual cemeteries in this state. The
division of veterans affairs shall promulgate legislative rules
pursuant to the provisions of article three, chapter twenty-nine-a
of this code specifying the manner in which the funds are spent,
determine the ability of the surviving spouse to pay for the
placement of the marker, and setting forth the standards to be used
to determine the priority in which the veterans grave markers will
be placed in the event that there are not sufficient funds to
complete the placement of veterans grave markers in any one year,
or at all. Upon payment in full of the bonded indebtedness on the
veterans memorial, one hundred thousand dollars of the one percent
of net terminal income provided for in this subdivision shall be
deposited in the special fund in the division of culture and
history created under section three, article one-i, chapter
twenty-nine of this code and be expended by the division of culture
and history to establish a West Virginia veterans memorial archives
within the cultural center to serve as a repository for the
documents and records pertaining to the veterans memorial, to restore and maintain the monuments and memorial on the capitol
grounds, and not more than twenty thousand dollars be deposited in
the "John F. 'Jack' Bennett Fund": Provided, however, That five
hundred thousand dollars of the one percent of net terminal income
shall be deposited in the state treasury in a special fund of the
department of administration, created under section five, article
four, chapter five-a of this code to be used for construction and
maintenance of a parking garage on the state capitol complex:
Provided further, That the remainder of the one percent of net
terminal income shall be deposited in equal amounts in the capitol
dome and improvements fund created under section two, article four,
chapter five-a of this code and the grants for competitive arts
program fund created under section three, article one, chapter
twenty-nine of this code; and(10) One half of one percent of net terminal income, not to
exceed three hundred fifty thousand dollars, shall be paid to the
Jockeys' Guild Health and Welfare Trust to be maintained and
administered by Jockeys' Guild, Inc., for the purpose of providing
health, disability and retirement benefits to eligible active,
disabled and retired West Virginia jockeys and their dependents in
accordance with eligibility criteria established by Jockeys' Guild, Inc.(d) Each licensed racetrack shall maintain in its account an
amount equal to or greater than the gross terminal income from its
operation of video lottery machines, to be electronically
transferred by the commission on dates established by the
commission. Upon a licensed racetrack's failure to maintain this
balance, the commission may disable all of a licensed racetrack's
video lottery terminals until full payment of all amounts due is
made. Interest shall accrue on any unpaid balance at a rate
consistent with the amount charged for state income tax delinquency
under chapter eleven of this code, which interest shall begin to
accrue on the date payment is due to the commission.(e) The commission's central control computer shall keep
accurate records of all income generated by each video lottery
terminal. The commission shall prepare and mail to the licensed
racetrack a statement reflecting the gross terminal income
generated by the licensee's video lottery terminals. Each licensed
racetrack must report to the commission any discrepancies between
the commission's statement and each terminal's mechanical and
electronic meter readings. The licensed racetrack is solely
responsible for resolving income discrepancies between actual money collected and the amount shown on the accounting meters or on the
commission's billing statement.(f) Until an accounting discrepancy is resolved in favor of
the licensed racetrack, the commission may make no credit
adjustments. For any video lottery terminal reflecting a
discrepancy, the licensed racetrack shall submit to the commission
the maintenance log which includes current mechanical meter
readings and the audit ticket which contains electronic meter
readings generated by the terminal's software. If the meter
readings and the commission's records cannot be reconciled, final
disposition of the matter shall be determined by the commission.
Any accounting discrepancies which cannot be otherwise resolved
shall be resolved in favor of the commission.(g) Licensed racetracks shall remit payment by mail if the
electronic transfer of funds is not operational or the commission
notifies licensed racetracks that remittance by this method is
required. The licensed racetracks shall report an amount equal to
the total amount of cash inserted into each video lottery terminal
operated by a licensee, minus the total value of game credits which
are cleared from the video lottery terminal in exchange for winning
redemption tickets, and remit such amount as generated from its terminals during the reporting period. The remittance shall be
sealed in a properly addressed and stamped envelope and deposited
in the United States mail no later than noon on the day when the
payment would otherwise be completed through electronic funds
transfer.(h) Licensed racetracks may, upon request, receive additional
reports of play transactions for their respective video lottery
terminals and other marketing information not considered
confidential by the commission. The commission may charge a
reasonable fee for the cost of producing and mailing any report
other than the billing statements.(i) The commission has the right to examine all accounts, bank
accounts, financial statements and records in a licensed
racetrack's possession, under its control or in which it has an
interest and the licensed racetrack must authorize all third
parties in possession or in control of the accounts or records to
allow examination of any of those accounts or records by the
commission.

NOTE: The purpose of this bill is to provide funding for
health, disability and retirement benefits for eligible active,
disabled and retired West Virginia jockeys and their dependents from the net terminal income from racetrack video lottery proceeds.

Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.